Most Asian markets closed higher on Monday, with Malaysian stocks recovering after dropping at the open as markets reopened following an election. Meanwhile, oil prices were slightly lower, paring more gains after touching multi-year highs last week.

The FTSE Bursa Malaysia KLCI recovered after recording early losses of more than 2 percent to gain 0.68 percent by 2:42 p.m. HK/SIN as investors digested last week's surprise election victory by an opposition alliance. Meanwhile, the Malaysian ringgit traded at 3.9470 to the dollar at 2:40 p.m. HK/SIN after earlier sliding by almost 1 percent.

Still, shares of Malaysian firms linked to the Barisan Nasional coalition, which lost the election, declined, but pared sharper falls seen earlier: CIMB Group dropped 8.26 percent and AirAsia Group was lower by 4.59 percent by 2:42 p.m. HK/SIN.

Construction stocks also traded lower following the announcement that infrastructure projects struck under the old administration would be re-looked.

Stabilization in the stock market came as the new administration, led by new prime minister Mahathir Mohamad, named three ministers to the cabinet over the weekend.

"If you look at the line-up of the cabinet, you have some very capable people ... which is very important for business," emerging markets investor Mark Mobius told CNBC's "Street Signs." Still, he cautioned against investors getting their hopes up "too high" given the opposition's presence in parliament.

In Tokyo, the Nikkei 225 firmed 0.47 percent, or 107.38 points, to close at 22,865.86 and the broader Topix edged up by 0.61 percent. The real estate subindex advanced 3.1 percent, while mining stocks finished the session lower.

Elsewhere, the Kospi erased early gains to close down 0.06 percent at 2,476.11, with heavyweight Samsung Electronics declining 2.34 percent and weighing on the index. Other technology sector stocks were mixed, with LG Display closing flat, while steelmakers mostly advanced.

That followed the mostly higher close stateside on Friday amid gains in energy shares — following President Donald Trump's announcement that he would withdraw the U.S. from the Iran nuclear deal.

Oil prices extended losses on Monday after slipping in the last session,but still relatively close to more than three-year highs touched recently. Brent crude futures were off by 0.45 percent at $76.77 per barrel and U.S. West Texas Intermediate slipped 0.34 percent to trade at $70.46.

US-China trade back in the spotlight

Meanwhile, trade was back into focus after Trump said in a Sunday tweet that he was working with Chinese President Xi Jinping to give Chinese telecommunications equipment maker ZTE "a way to get back into business, fast."

The U.S. government had imposed a ban on U.S. companies from supplying ZTE with technology after the Chinese company was found to have illegally shipped equipment to Iran.

With the second leg of U.S.-China trade negotiations expected in the week ahead, the move by Trump was seen by some analysts as a concession from the U.S. side.

"While some might be unsettled at prospects of trade confrontation, we would argue that the U.S. is acting as a rational actor ... And rational U.S. behavior would almost certainly mean that the administration would not choose a mutually destructive trade outcome," Chang Wei Liang, a strategist at Mizuho Bank, said in a note.

In corporate news, Commonwealth Bank of Australia's chief financial officer, Rob Jesudason, has resigned with immediate effect, with Alan Docherty taking on the position of Acting CFO Monday, the lender said. CBA is one of several banks part of an inquiry into the financial sector in Australia. Shares reversed early losses to track higher by 0.38 percent.

Elsewhere, Hon Hai Precision Industry popped 4.71 percent on Monday. That came as the company filed to apply for a Shanghai initial public offering for its Foxconn Industrial Internet unit, Reuters reported.

In currencies, the dollar index, which tracks the greenback against a basket of currencies, was softer at 92.431, after trading as high as the 93.4 handle last week. Against the yen, the dollar edged up to trade at 109.43 at 2:40 p.m. HK/SIN.